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Dollar edges higher despite U.S. data miss

Published 05/19/2016, 08:38 AM
Dollar gains some ground as U.S. rate hike hopes overshadow weak data
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Investing.com - The dollar edged higher against the other major currencies on Thursday, despite the release of disappointing U.S. data, as fresh expectations for a June rate hike by the Federal Reserve continued to support the greenback.

EUR/USD slipped 0.17% to 1.1195, the lowest since March 29.

The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending May 14 decreased by 16,000 to 278,000 from the previous week’s total of 294,000. Analysts expected jobless claims to fall by 19,000 to 275,000 last week.

Separately, the Federal Reserve Bank of Philadelphia said that its manufacturing index deteriorated to -1.8 this month from April’s reading of -1.6. Analysts had expected the index to improve to 3.5 in May.

But the dollar remained supported after the Fed’s April meeting minutes showed that officials said a June rate hike would be appropriate if economic data indicated that growth was picking up in the second quarter and employment and inflation were firming.

USD/JPY was down 0.23% to 109.97.

The dollar was steady against the pound, with GBP/USD at 1.4607 and rose against the Swiss franc, with USD/CHF up 0.30% at 0.9908.

The pound strengthened earier, after the U.K. Office for National Statistics said retail sales rose 1.3% in April, well above economists’ forecasts for an increase of 0.5%.

March’s figures were revised to show a 0.5% drop, a much smaller decline than the initial estimate of a fall of 1.3%.

The Australian and New Zealand dollars were weaker, with AUD/USD down 0.54% at 0.7190 and with NZD/USD edging down 0.16% to 0.6729.

The Aussie dropped to two-month lows after the Australian Bureau of Statistics reported that the number of employed people increased by 10,800 in April, confounding expectations for a 12,500 rise.

Australia’s unemployment rate remained unchanged at 5.7% in April, compared to expectations for an uptick to 5.8%.

Elsewhere, USD/CAD climbed 0.74% to trade at 1.3130, after Statistics Canada said that wholesale sales declined by 1.0% in March, compared to expectations for a 0.5% fall. Wholesale sales dropped 2.3% in February, whose figure was revised from a previously estimated 2.2% slide.

The loonie was also hit as oil prices moved sharply lower after data on Wednesday showed that U.S. stockpiles rose unexpectedly last week.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.21% at 95.40, the highest since March 29.

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